X hits on this document

PDF document

(District of New Jersey D.C. 01-cv-04183) - page 22 / 30

94 views

0 shares

0 downloads

0 comments

22 / 30

execution of its fiduciary obligations, the beneficiaries of the customer benefit plans are not the “real” clients. We look to four factors in reaching this conclusion. The first is the ownership of the assets. In situations in which the fiduciary exception traditionally has been applied, the fiduciary is managing assets over which it lacks ownership rights. For instance, a trustee, by definition, manages a trust res it does not own; because the trust separates ownership from management, the trustee can have no legitimate personal interest in the trust’s funds or its management. See Riggs, 355 A.2d at 711. Similarly, a corporate manager manages assets owned by the

shareholders

of

the

corporation.3

In

contrast,

although

ERISA

typically 1103(a),

requires that plan assets be held in trust, 29 U.S.C. § this requirement is excepted for insurance companies

providing insurance contracts. Although HN-NJ’s disposition of

29 U.S.C. § its assets may

1103(b)(1)-(2). be limited by its

contractual and statutory obligations, nonetheless remains with HN-NJ. management and ownership places an

legal title to the assets This convergence of insurer like HN-NJ in a

different

position

than

other

ERISA

fiduciaries

to

whom

the

fiduciary exception

has been applied, and

demonstrates that HN-

NJ

has

a

substantial

and

legitimate

interest

in

the

management

of

its

assets

  • even

while

it

engages

in

fiduciary

acts.

Second, our Court has recognized that when an insurance

3A corporate manager may be a shareholder of the same corporation whose assets it manages. That such a manager may wear two hats does not change the fact that the hats it wears are legally distinct.

22

Document info
Document views94
Page views94
Page last viewedSun Dec 11 02:37:13 UTC 2016
Pages30
Paragraphs461
Words7026

Comments